The influence of Free-Trade on the environmental effects of transportation. Scale-, Technique- and Composition-Effects

The changeover from a situation of Autarky to a situation of Free- Trade alters the trade and production patterns of the participating countries which in turn affects the transportation-sector. The amount of transported goods and the directions of the good-flows change. Profit-oriented shipping companies can and do respond to these changes by selecting adequate means and modes of transport for different routes and by building-up or restructuring a transportation-network. These changes affect the corresponding level of pollution from transport. We distinguish a scale effect which evolves from a higher frequency of transportation movements with an unchanged infrastructure of transportation, a technique effect which results by increasing the load per movement and a less than proportional increase in pollution per distanceunit and a composition effect which reflects an increase load per movement and a constant or decreasing pollution per distance-unit. Adding up all three effects could eventually lead to a lower pollution level in a situation with Free-Trade than with Autarky.